Shareholders of an insurance company recently called upon a law firm to investigate a proposed purchase by a similar firm. Depending on the outcome of this situation, it has the potential to become a securities class action lawsuit.
Law firm Robbins Arroyo, LLP., will look into Great American Insurance's purchase of National Interstate Corporation on behalf of the latter's stockholders. This is due to potential securities law violations and a breach of fiduciary duty.
The deal was completed on Feb. 5, 2014, as Great American Insurance's parent company, American Financial Group, released a statement that it would purchase the remaining shares that it did not already possess of National Interstate Corporation. The agreed deal would be for $28 per share in cash.
This price may be too low for shareholders, and the law firm plans to see if the board of directors at National Interstate Corporation did enough to get the most value for those who own its stock. Multiple members of the company's board of directors are in positions of power at both American Financial Group and its subsidiary.
The pending transaction would give shareholders approximately 26.3 percent in a premium from its closing price on Feb. 4. However, this is notably lower than the 35 percent for similar deals in the past few years. National Interstate Corporation had a trading value of $36.36 per share on July 18, 2013.
It is possible to speak with the law office about the possibility of a class action claim, as well as more information regarding their rights in this process. Darnell Donahue, a member of the firm, is available to field questions, and he can be reached by telephone or email. The law office's website also provides information.
Second investigation commences
Another law office is examining shareholders' claims that there may be issues with the purchase.
Bernstein Liebhard, LLP., recently began an investigation into whether or not the pending transaction breaches fiduciary duty by the board of directors at National Interstate Corporation. American Financial Group is also being examined as a part of this investigation from the law firm.
Shareholders who are interested in learning more about this investigation are also welcome to speak with this law firm. The best contact is U. Seth Ottensoser, and he can be reached by telephone or email.